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Two decades of solid growth

Wednesday, May 11, 2011

Gulf News

Dubai Offsetting industry challenges, Emirates airline recorded a massive 52 per cent jump in profit for the financial year 2010-2011, the airline announced yesterday.

Net profit rose to Dh5.4 billion in the year over 2009-10’s profit of Dh3.5 billion.

Revenues for the Arab world’s largest carrier grew 25 per cent to Dh54.4 billion, largely driven by strong demand and the delivery of new aircraft.

Emirates carried 31.4 million passengers, up 14.5 per cent over last year, and 1.8 tonnes of cargo — up 11.8 per cent.

Emirates Group , which includes the airline and Dnata , achieved a 43 per cent jump in net profit to Dh5.9 billion in the year, having fought environmental and political hurdles and marking the 23rd consecutive year of profit.

Group revenue reached Dh57.4 billion, a strong 26.4 per cent increase over the previous year, resulting in the group’s record performance.

Shocking disasters

“ Emirates Group has come through another challenging year which started with the volcanic ash cloud that rattled the airline industry across the globe. Other natural disasters included the record snowfall for the year in the UK and the US followed by earthquakes in New Zealand and Japan – all contributing to service disruptions,” said Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and Chief Executive of Emirates airline and Group.

Echoing similar thoughts, Addison Schonland, US-based aviation analyst and President of Innovation Analysis Group (IAG), told Gulf News: “Other airlines are trying to avoid losses and yet Emirates keeps soaring.

“The performance is gravity defying and surely a source of great concern to its competition.”

The airline also increased its seat load factor by 80 per cent — the highest ever and four percentage points higher than the average seat load factor globally.

“Emirates has risen to become the number one airline in the world by scheduled international passengers in terms of kilometres flown,” said Shaikh Ahmad.

He added that global passengers increased by 8.2 per cent over the previous year, according to IATA figures.

“The Emirates Group faced the same challenge as other airlines although we are fortunate to be operating in the Middle East where regional traffic grew 17.8 per cent, according to IATA numbers,” he said.

Dnata forges ahead

Driven by international expansion, dnata’s revenue for the year exceeded Dh4 billion for the first time, reaching Dh4.4 billion, up 39.4 per cent over last year, the company said.

The increase is primarily a result of increased revenues from airport operations and cargo handling businesses in addition to the acquisition of Alpha Flight Group in December 2010.

Dnata earned its second highest profit in its operating history with Dh560 million, while the division’s operating costs for the 2010-11 financial year were Dh3.9 billion.

“Dnata’s profit is down in the year due to the acquisition of Alpha,” said Shaikh Ahmad, adding that dnata is now the world’s fourth largest combined air services provider.

The number of aircraft handled by dnata during the year increased by 21.1 per cent to 232,585, and cargo volume rose 33.3 per cent to 1.49 million tonnes.

SkyCargo revenue up

The company’s cargo division, SkyCargo, recorded a 27.6 per cent increase in revenue to a record Dh8.8 billion owing to the worldwide rebound in cargo traffic.

Cargo tonnage increased by 11.8 per cent over the previous year to 1.76 million tonnes, while additionally freight yield per FTKM (freight tonne kilometre) increased by 11.3 per cent, the company said, adding that cargo revenue contributed 17.4 per cent to the airline’s total transport revenue.

Dubai (WAM) His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, praised the role of Emirates Group in supporting the nation’s development march.

“We are proud of the Emirates Group as it is one of our most prominent national organisations that supports the country’s development march. We are also proud of its expertise and highly efficient performance that enabled to overcome the challenges that emerged from regional and international changes,” Shaikh Mohammad said in a statement issued after Emirates Group announced its financial results for 2010-2011.

“We are very optimistic about the future of the airline and its aspiring plans. The source of such optimism comes from a history that is filled with landmark achievements that helped the airline to be among the prominent and prestigious global airlines in the world. This was achieved adhering to the principles of fair competition, transparency and open skies,” Shaikh Mohammad said.

“We are confident that both Emirates airline and dnata, through their combined professional experience, are capable of more achievements and successes. Our confidence and optimism are increased by the commitment and innovation of the group’s professional team,” Shaikh Mohammad said.

By Shweta Jain?Senior Reporter

© Gulf News 2011. All rights reserved.